Are Plans to Mine Asteroids Within Reach or Still Light Years Away?

Optimists say they could be prospecting asteroids in five to 10 years. Pessimists say, "Earth first: We'll mine the other planets later."

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MINYANVILLE ORIGINAL When it comes to finding new resource deposits, at least one company seems to think asteroids represent the next frontier.

In recent weeks, Planetary Resources, a venture financially backed by investors such as Google (GOOG) CEO Larry Page and Ross Perot, Jr. and advised by filmmaker James Cameron and former NASA astronaut Tom Jones, announced a plan to mine near-earth asteroids for raw materials including everything from water to precious metals.

"A single 500-meter platinum-rich asteroid contains the equivalent of all the Platinum Group Metals mined in history," the group explained in a press release.

While it seems farfetched, no less than the esteemed institution NASA has been training at least 16 astronauts on asteroid exploration. And anyone in the mining industry knows, where exploration goes, exploitation is likely to follow if natural resources are found.

Asteroids, are enticing as a result of their small gravity fields, which make it easier to place spacecraft and mining equipment on the surface.

"Many of the scarce metals and minerals on Earth are in near-infinite quantities in space," asserts Planetary Resources. "As access to these materials increases, not only will the cost of everything from microelectronics to energy storage be reduced, but new applications for these abundant elements will result in important and novel applications," notes Planetary Resources co-founder and co-chairman Peter H. Diamandis.

In terms of stakeholders that may stand to benefit from the company's "advances in low-cost spacecraft and cost-effective space technologies, as well as access to plentiful in-space resources such as water and rocket propellant," Planetary Resources points to government agencies like NASA, the scientific community, universities, non-profit institutions, and the commercial spaceflight sector.

Chris Lewicki, Planetary Resources president and chief engineer, told Forbes in April that the company "already [has] contracts with NASA, some private companies, and even a few private individuals."

Investors also seem to be interested. According to reports, the company has received more than 2,500 investment requests since launch.

Although investors can gain access to platinum ("PGM") mining on Earth through the ETFS Physical Platinum Shares ETF (PPLT) or through direct investment in miners such as Stillwater Mining (SWC), Lonmin (LMI.L), or Zimplats (ZIM.AX), it is not clear whether investors will be able to make asteroid mining part of their portfolios anytime soon.

Although Planetary Resources is reportedly expecting to launch a demonstration mission around Earth within two years, progressing to prospecting within a five to 10 year timeframe, the company has not discussed specifics in terms of how and when it plans to start asteroid mining.

Erica Rannestad, a commodity analyst with CPM Group in New York, says that an asteroid mining initiative is by no means a near-term project for platinum group metals and other precious metals supply.

"It seems unlikely to be successful and very unfeasible at present. It seems uneconomical over the next few decades even. This would involve developing a host of technologies, infrastructure, and methods of extraction that do not exist today," she says.

"The more likely scenario would be the birth of new technologies to be used in future space exploration," she adds.

Raymond Goldie, vice-president and senior mining analyst at Salman Partners in Toronto, notes that there is no shortage of platinum ore here on earth.

"In fact, mines in South Africa are closing not because they have run out of ore, but because there is not enough demand for their product," says Goldie. In South Africa in June alone, global giant Anglo American (AAL.L) closed the Marikana mine, Eastern Platinum (ELR.TO) halted a new platinum project at Steelport, and Aquarius Platinum (AQP.AX) suspended operations at its Everest Mine.

That may be, but asteroids offer more than PGMs. Many have pointed out that water is the real prize. According to Diamandis, a typical 50-meter asteroid of rock and ice could have enough hydrogen and oxygen to power all the flights in the history of the Space Shuttle program.

Still, Planetary Resources co-founder Eric Anderson recently told Bloomberg that on a 50-year time scale, the inclusion of space resources will add trillions of dollars to the global GDP. "We'll be the first company to do this, but no doubt there will be many others," he said.

Indeed, Planetary Resources is not the only company interested in space mining. Another firm, Moon Express, announced earlier this year that a number of scientists have joined its Science Advisory Board "to assist the company in its plans to explore and ultimately mine the moon for precious planetary resources."

Over the last year, Moon Express says that it hosted a series of lunar science workshops to "assess the scientific evidence for platinum group metals deposited on the moon through eons of asteroid bombardment, and the advisability and technical feasibility of mining and recovering the materials for use on Earth and in space."

While the mining companies keep working on how they'll mine, there's no shortage of explorers mapping new places for future drillers.

An organization called the B162 Foundation plans to announce on June 28 the world's first privately funded deep space mission to create a detailed map of inner space. Given the group's affiliations including Ball Aerospace's former director of science mission development, a former space shuttle astronaut, a former lunar module pilot from Apollo 9, the program seems credible.

Other high-flying projects include Stratolaunch, Microsoft (MSFT) co-founder Paul Allen's company which plans to build the largest airplane in history to help enable private spaceflight. Amazon.com (AMZN) founder Jeff Bezon and PayPal co-founder Elon Musk are also funding private space ventures.

Meanwhile, doubters like Salman Partners' Goldie think investors should keep their hopes grounded. Goldie cites the difficulties Nautilus Minerals (NUS.TO) has had in obtaining funding to mine the floor of the ocean, which he says is "surely more accessible than asteroids."